AI boom leaves Europe trailing in direct investment

US equity leadership this year is heavily tied to AI-linked companies. The S&P 500 has gained roughly 13.5% year-to-date, adding about $9 trillion in market value, but an index excluding AI-linked companies has risen only about 5.5%, compared with approximately 5.6% for the Euro Stoxx 600 Index.

The investment flow is concentrated in North America. Global AI investment is expected to exceed $1 trillion this year and could reach approximately $1.4 trillion by 2027, while the US and Canada are projected to account for roughly 60% of new global data center capacity in 2026. Europe’s share is only about 10%, and the eurozone holds just 5% of global computing power.

Europe is still benefiting through manufacturing, credit and earnings expectations. Eurozone companies are expected to allocate about 10% of investment to AI in 2026, and AI-related lending accounted for 25% of corporate credit growth in the first quarter of this year. Goldman Sachs expects AI investment to add about 0.1 percentage point to European GDP growth in 2026, but much of the boost comes from spillovers rather than domestic infrastructure spending.

Persistent macroeconomic strains limit the payoff. Eurozone Q3 GDP growth is expected to be just 0.2% quarter-over-quarter, German manufacturing orders fell 10.6% month-over-month in August, and French industrial production excluding construction has declined 0.8% quarter-to-date. Political stress in France, higher energy-driven inflation and US tech giants tapping euro-denominated debt add further pressure.